The Dubai Multi Commodities Center (DMCC) has awarded a cryptocurrency license to Regal RA DMCC. The company which specializes in gold trading under this license become the first company to be granted a cryptocurrency trading license in the Middle East. Apart from trading in cryptocurrencies, the DMCC license also allows the company to store cryptocurrencies like bitcoin, ether, as well as other altcoins. According to a DMCC spokesperson, the cryptocoins will be stored in a high-security vault situated at the Almas Towers DMCC headquarters in Dubai.
Vault Offers Security for Crypto
The vault itself is designed to provide maximum security for the stored digital currency assets. It is entirely off-the-grid, with no connection to any network. The contents of the vault are fully insured against all forms of losses including but not limited to natural disasters, hacking, and theft. Such thorough security measures are necessary considering the frequency with which hackers and cybercriminals target cryptocurrency holdings.
There have been many high profile cryptocurrencies hacks and thefts which have resulted in millions of dollars’ worth of cryptocurrency stolen from online exchanges and wallets. In January 2018, hackers stole nearly $500 million worth of cryptocurrency from the exchange platform, Coincheck. The scandal was one the of the most prominent cryptocurrency thefts since the Mt. Gox hack of 2014.
Commenting on the development, Ahmed Bin Sulayem, the Executive Chairman of the DMCC hailed the move as being an embodiment of the organization’s mandate. He said that the DMCC is at the forefront of utilizing cutting-edge technology to disrupt business processes as well as connect emerging markets with potential customers. He further went on to state that the DMCC is focused on developing creative innovations and solutions that provide a platform for sustainable long-term growth.
UAE: Pioneer of Crypto in the Middle East
On the global scene, there have been moves by numerous government and regulatory agencies to restrict cryptocurrency trading. Many have sounded dire warnings against putting up equity into the market with fears that it is all a giant bubble that can burst at any time. In the Middle East, several countries have warned against investing in the market. The Saudi Arabian Monetary Authority (SAMA) which is the Central Bank of Saudi Arabia has advised citizens not to invest in bitcoin. The Qatar Central Bank (QCB) earlier in February prohibited the country’s banks from dealing in cryptocurrencies.
While most of the Arab world seems to be taking a stance against cryptocurrency, the situation in the United Arab Emirates (UAE) seems a little different. Regulators of the Abu Dhabi Global Market (ADGM), the International Finance Center of the country, have said that regulations that will oversee the activities of cryptocurrency exchange platforms are imminent. With this move by the DMCC to grant a crypto trading license to Regal RA DMCC, it is likely that the UAE is in favor of developing an active national and international cryptocurrency market.
Regal RA DMCC is a subsidiary company of the Regal Assets conglomerate which was established in 2009. The headquarters of the firm is located in Waco, Texas. Regal RA DMCC focuses on alternative assets management and has offices in the UAE, Canada, and the United States. The license to trade cryptocurrencies is part of the company’s goal of creating an international cryptocurrency exchange platform.
According to Ksenia Kiseleva, the head of the company’s Dubai office, cryptocurrencies are seen by the company as a commodity and not as a means of payment processing. She also went further to state that the company will apply for similar trading licenses in other countries to fulfill the growing demand for cryptocurrencies both in the UAE and the rest of the world.